Professional Documents
Culture Documents
1. Describe the shifts in the world economy over the past implications of such a development for (a) the world
30 years. What are the implications of these shifts for trading system, (b) the world monetary system,
international businesses based in Great Britain? North (c) the business strategy of today’s European and
America? Hong Kong? U.S.-based global corporations, and (d) global
2. “The study of international business is fine if you are commodity prices.
going to work in a large multinational enterprise, but it 7. Reread the Management Focus on Vizio and answer
has no relevance for individuals who are going to work the following questions:
in small firms.” Evaluate this statement. a. Why is the manufacturing of flat-panel TVs
3. How have changes in technology contributed to the migrating to different locations around the world?
globalization of markets and production? Would the b. Who benefits from the globalization of the flat-
globalization of production and markets have been panel display industry? Who are the losers?
possible without these technological changes? c. What would happen if the U.S. government
4. “Ultimately, the study of international business is no required that flat-panel displays sold in the United
different from the study of domestic business. Thus, States had to also be made in the United States? On
there is no point in having a separate course on balance, would this be a good or a bad thing?
international business.” Evaluate this statement. d. What does the example of Vizio tell you about the
future of production in an increasingly integrated
5. How does the Internet affect international business
global economy? What does it tell you about the
activity and the globalization of the world economy?
strategies that enterprises must adopt to thrive in
6. If current trends continue, China may be the world’s highly competitive global markets?
largest economy by 2020. Discuss the possible
Use the globalEDGE website (globaledge.msu.edu) to 2. You are working for a company that is considering
complete the following exercises. investing in a foreign country. Investing in countries
with different traditions is an important element of
1. As the drivers of the globalization continue to pressure your company’s long-term strategic goals. As such,
both the globalization of markets and globalization of management has requested a report regarding the
production, we continue to see the impact of greater attractiveness of alternative countries based on the
globalization on worldwide trade patterns. HSBC, a potential return of FDI. Accordingly, the ranking of
large global bank, analyzes these pressures and trends the top 25 countries in terms of FDI attractiveness is a
to identify opportunities across markets and sectors, crucial ingredient for your report. A colleague
through its trade forecasts. Visit the HSBC Global mentioned a potentially useful tool called the “Foreign
Connections site, and use the trade forecast tool to Direct (FDI) Confidence Index.” The FDI Confidence
identify which export routes are forecasted to see the Index is a regular survey of global executives conducted
greatest growth over the next 15 to 20 years. What by A.T. Kearney. Find this index, and provide
patterns do you see? What types of countries dominate additional information regarding how the index
these routes? is constructed.
In its early days, Apple usually didn’t look beyond its own backyard to By 2004, however, Apple had largely turned to foreign manufacturing.
manufacture its devices. A few years after Apple started to make the Ma- The shift to offshore manufacturing reached its peak with the iconic iPhone,
cintosh computer back in 1983, Steve Jobs bragged that it was “a ma- which Apple first introduced in 2007. All iPhones contain hundreds of parts,
chine that was made in America.” As late as the early 2000s, Apple still an estimated 90 percent of which are manufactured abroad. Advanced
manufactured many of its computers at the company’s iMac plant in Elk semiconductors come from Germany and Taiwan, memory from Korea and
Grove, California. Jobs often said that he was as proud of the Apple’s man- Japan, display panels and circuitry from Korea and Taiwan, chip sets from
ufacturing plants as he was of the devices themselves. Europe, and rare metals from Africa and Asia. Apple’s major subcontractor,
Endnotes
1. Figures from World Trade Organization, Statistics Database, 4. T. Levitt, “The Globalization of Markets,” Harvard Business
2013. Review, May–June 1983, pp. 92–102.
2. Thomas L. Friedman, The World Is Flat (New York: Farrar, 5. U.S. Department of Commerce, Internal Trade Administra-
Straus and Giroux, 2005). tion, “U.S. Exporters in 2011: A Statistical Overview,” July
3. Ibid. 29, 2013.